Hiring, and the filters · 4.5

Credential inflation

Credential inflation. What is actually the case, and how it compares with what is repeated.

A practical software reference for this part of the discussion is Monitask's overview of employee attendance tracker.

The qualification required for a job rises over time while the job stays the same. That is credential inflation, and there are two distinct versions of it.

Degree requirements

Analysis of American job advertisements found large numbers of postings demanding a degree for roles where most people already doing the work did not have one. Supervisory roles in retail, administrative roles, and technical support were prominent.

The requirement was not describing the work. It was being used as a filter to reduce the applicant pool, which it does effectively and without regard to whether the excluded applicants could do the job.

The reset that was announced

From about 2020 a number of large employers and several state governments publicly removed degree requirements from many roles. The announcements were extensive.

A study published in 2024 examined what actually happened to hiring afterwards and found the change very small: on the order of one additional non-degree hire per several hundred, concentrated in a few firms that had done more than announce.

That gap between announcement and practice is the most useful finding in this area, and it generalises well beyond hiring.

Why the requirement is sticky

Because removing it from the advertisement does not change who recruiters shortlist, what the hiring manager believes, or the comparison against other candidates who do have degrees.

A filter written in a document is easy to delete. A filter operating in the judgement of the people making the decision is not, and the second was doing most of the work.

Occupational licensing

The other version. The share of American workers requiring a state licence to do their job has risen substantially since the middle of the twentieth century, from a small fraction to roughly a quarter.

Some of that growth covers occupations where a case for licensing is clear. Much of it does not, and the pattern of which occupations acquired licences correlates with which had organised bodies to ask for them.

What licensing does

Raises pay for those inside it and raises prices, both consistently found. Effects on quality and safety are much harder to demonstrate and the evidence for them is weak in many licensed occupations.

It also blocks mobility, because a licence obtained in one state frequently does not transfer, which matters most for people who move often, including military families.

Signalling

A credential can convey a skill or it can convey that the holder was able to obtain the credential. The two explanations are hard to separate empirically and both are true in different proportions in different fields.

Where the signalling share is large, the credential is a screening device paid for by the applicant, and inflation follows automatically: once enough people hold it, it stops distinguishing anybody and the next level becomes necessary.

Who pays

Applicants, in fees and years. The costs fall hardest on people who cannot take unpaid time, which is the population the requirement is least likely to be accurate about.

Employers pay too, in a smaller applicant pool and a longer fill time, which is why the reset was announced at all: it was a response to vacancies rather than to fairness.

What actually removes a requirement

Changing what the interview scores, not what the advertisement says. Skills-based assessment applied consistently, structured against the criteria in the entry on interviews, with the degree field removed from what the shortlister sees.

Employers who have done that report changes in who they hire. Employers who amended the advertisement report announcements.

The apprenticeship alternative

Where countries operate substantial apprenticeship systems, the credential attaches to demonstrated competence in the occupation rather than to years in a classroom, and the inflation dynamic is weaker.

Those systems are expensive, require employer coordination, and are difficult to build where they do not already exist, which is why they are admired more often than copied.

What a degree requirement is standing in for

Usually one of three things: an expectation of written communication, an expectation of persistence, or a proxy for the social class the employer is used to hiring.

The first two can be assessed directly and briefly. The third cannot be defended out loud, which is one reason the requirement is written as a qualification rather than as what it is doing.

For broader context, consult Harvard research on degree inflation.